We are not rip-off retailers, says Sainsbury’s
The company also defended increased pay packages for its senior executives despite the continued cost-of-living crisis.
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Your support makes all the difference.Bosses at Sainsbury’s have said they are “not rip-off retailer” or “profiteers” as they defended the profit made by the retailer amid scrutiny related to food inflation over the past year.
The company also defended increased pay packages for its senior executives at its annual general meeting in London, despite the continued cost-of-living crisis.
It comes two days after the UK’s second largest chain reported a 9.8% jump in sales for the latest quarter and highlighted that food inflation is “starting to fall”.
The UK competition watchdog is investigating grocery retailers in the face of accusations they could be profiteering from more expensive food and drink.
Latest figures from the Office for National Statistics (ONS) show food inflation eased slightly in May but remained at 18.4%.
On Monday, the Competition and Markets Authority (CMA) also said it had found that drivers paid nearly £1 billion more for fuel at supermarkets last year due to increased margins.
In response, energy and net zero minister Grant Shapps said: “We’ll shine a light on rip-off retailers to drive down prices and make sure they’re held to account by putting into law new powers to increase transparency.”
At the retailer’s AGM on Thursday, the supermarket group’s chairman Martin Scicluna defended the industry.
“To be very, very clear, we are not profiteering and we are not rip-off retailers,” he said.
“We make 3p on every pound we sell. If we offered you something for £1, and I said I made 3p on that product, I don’t think you would call us a rip-off merchant or a profiteer, but some MPs have.”
The supermarket highlighted that it has cut prices on 120 essentials such as bread, butter, milk and pasta as wholesale costs have eased, with £60 million invested into price reductions since March.
Shareholders met to vote on a series of items, including the pay package for company executives.
The remuneration includes an almost £5 million deal for chief executive Simon Roberts.
The CEO since 2020 saw his overall pay deal for the year to March rise by more than £1.4 million to £4.947 million, due to almost £4 million in bonuses.
After questioning from shareholders, Mr Scicluna said he supported the package.
He said: “What we are trying to do is focusing on rewards for Simon, the operating board, senior leadership and colleagues. That’s why our colleague pay has gone up 44% over the past four years.
“It is a lower fixed pay, around 19% of the total, but we incentivised Simon and the team with the bonus and LTIPs (long-term incentive payments) to make sure that we grow profits, because it is good for the company and means we can invest in innovation, technology and reward shareholders.
“All this is balanced and we try to do it in a proper way – because it comes through the board, I stand by it completely.”